Is Middle Management the Key to Your ERP Success?

Much of Panorama’s thought leadership and philosophy surrounding ERP implementation success encompasses the concept of executive sponsorship and leadership. In fact, a key component of our organizational change management methodology focuses on enabling the executive alignment, support and hands-on decision-making necessary for ERP success. Further to the point, without executive sponsorship and buy-in, most other critical success factors are likely to be ignored.

Although we’ve gone to great lengths to highlight the need for effective executive sponsorship in our writing, analyses and practice, we haven’t spent much time opining about the role of mid-level managers. However, according to a recent article in
Harvard Business Review, middle management is often a key to the success of any large business or technological transformation, such as an ERP implementation. The article summarizes a study that reveals that most change initiatives fail – 68%, to be exact – which is consistent with our research that most ERP implementations fail (see our
2013 ERP Report for more detail).

The article goes on to explain the Triple-A leadership model (i.e., alignment, authorship and action) which the author believes successful mid-level managers leverage more effectively than those that fail in their change initiatives. Although the model focuses on change initiatives in general, there are several lessons that are applicable to ERP implementations:

Alignment applies to all layers of management. While most organizational change management efforts focus on ensuring executive alignment, mid-level managers need to be aligned as well if the project is to be successful. This is at least partly due to the fact that because of their proximity to executives and front-line employees, mid-level managers have a unique 360-degree view of an organization. The HBR study suggests that mid-level managers are more likely to be effective in change efforts when the changes are aligned with their own beliefs and values. We support this theory and have developed our own
PERFECT Change™ organizational change management methodology to ensure that all stakeholders – including mid-level managers – are aligned with the ERP implementation. This can be most effectively done by “selling” the value of the changes to the individual managers. Although these messages often need to be tailored to address varying motives (and motivations) at the individual level, the time and effort doing so delivers tremendous value when done correctly.

Management ownership and buy-in is an extremely powerful thing. The second component of the Triple-A model, known as authorship, suggests that managers need to be involved in the creation of change and innovation plans. In terms of ERP implementations, this means getting more mid-level managers involved in overseeing various components of the initiative, such as defining requirements, reengineering business processes or testing the enterprise software for their respective areas. When mid-level managers are invested in key project activities such as these, they are more likely to direct resources and organizational focus to these important implementation activities. Keep in mind that many projects fail because of lack of resource involvement, so a high level of management ownership and buy-in is a very powerful way to avoid this common pitfall.

Walking the talk is key to ERP success. Mid-level managers need to be empowered to be involved in the project and make key decisions. In other words, they need to take action, which is the third component of the Triple-A leadership model. There are a number of ways this variable can affect an ERP implementation. For example, instead of delegating key decisions to project team members, mid-level managers should take a hands-on role in helping to define and approve the ways that
business process reengineering will affect their respective parts of the organization. This example helps in two ways: 1) it ensures that the new business processes and ERP systems are designed in alignment with management’s vision for the particular function, and 2) it sends a message to the rest of the organization that management is on-board with and supportive of these changes, which are both important prerequisites to transformation.

In summary, ERP implementations are a lot like any other business change initiative – they won’t succeed without the right degree of management support and buy-in. Further, the required buy-in and support won’t just happen without a focused and methodical way of addressing these organizational nuances, no matter how well run your organization is or well intentioned your employees are. Only a comprehensive and effective
organizational change management plan will enable the type of support needed from your people, including your mid-level managers.